July 24 (Bloomberg) -- Standard Chartered Plc’s board said
it’s “united in its support” of Chief Executive Officer Peter
Sands, rejecting a newspaper report that it’s considering
replacing him due to investor pressure over declining profit.

“Robust and considered succession plans are in place for
all of the senior leaders,” the London-based bank said in a
statement last night. “We will ensure orderly succession takes
place at the appropriate times. No succession planning is taking
place as a result of recent investor pressure.” The board also
said it supports Chairman John Peace.

The Financial Times reported yesterday that Peace has been
urged to search for a new CEO, with Temasek Holdings Pte, the
Singapore state-owned investment company that owns about 18
percent of the bank, pressing for a clearer succession plan,
citing people it didn’t identify. Aberdeen Asset Management Plc,
another stakeholder, also wants Sands replaced, the FT said.

“This reminds us very much of the dreaded ‘vote of
confidence’ often issued to football managers just before they
get the bullet,” said Gary Greenwood, an analyst at Shore
Capital Stockbrokers Ltd. based in Liverpool, England, who has a
buy recommendation on shares. “What is clear to us is that
operational performance needs to improve quickly if senior
management are to remain in place.”

Shares Decline

Standard Chartered shares have dropped 11 percent this year
as clients moved away from trading interest-rate and foreign-exchange products amid low volatility. The stock fell as much as
0.9 percent today and traded 0.3 percent lower at 1,217.50 pence
at 9:44 a.m. in London.

The bank said in May it was “concerned” that 41 percent
of voting shareholders opposed its new pay policy after
reporting a “high single-digit percentage” drop in first-quarter operating profit.

Aberdeen, which owns about 7.7 percent of shares, declined
to comment on the bank’s leadership.

“As an investor in banks with a long-term view, we look
for stability in the banking system, and banks specifically,”
Stephen Forshaw, a spokesman for Temasek, said in an e-mailed
statement today. “We have well-established principles on
governance issues, which we discuss with the bank, as we do with
all the companies in which we invest.”

Lower Profit

Standard Chartered, which generates more than three-quarters of its earnings in Asia, said on June 26 that first-half operating profit probably slumped 20 percent and forecast
full-year profit, excluding goodwill impairment and swings in
the value of its own debt, to be lower than in 2013.

Sands, 52, became CEO in November 2006, making him the
longest-serving boss of any major British bank. He last year
suspended a target to increase revenue by at least 10 percent
after writing down the South Korean business by $1 billion.

“We can understand why there is pressure for change at the
top,” Sandy Chen, an analyst at Cenkos Securities Plc in
London, said in an e-mailed note today. Chen has a buy
recommendation on the shares.

Former Vodafone Group Plc Chief Financial Officer Andrew
Halford became Finance Director of the bank in June, replacing
Richard Meddings, who helped steer the bank to a decade of
profit growth. Mike Rees became deputy CEO in April.